SOURCE: Wellspring Capital Management

November 10, 2006 13:27 ET

Wellspring Capital Management Sells Tube City IMS Corporation to Onex Partners

NEW YORK, NY -- (MARKET WIRE) -- November 10, 2006 -- Wellspring Capital Management LLC ("Wellspring") announced today that it has entered into a definitive agreement to sell all of the outstanding shares of Tube City IMS Corporation ("Tube City IMS"), for total cash consideration of $620 million on a cash and debt free basis to Onex Partners, a $3.5 billion private-equity fund managed by Onex Corporation.

Tube City IMS operates at 66 steel mills throughout the U.S., Canada and Europe, providing raw materials procurement, scrap and materials management, and slag processing services. Headquartered in Glassport, PA, Tube City IMS employs approximately 2,350 people.

"Tube City IMS' strong management team, world-class operations and compelling growth characteristics drove our interest in the Company, and this transaction represents a favorable outcome for Wellspring," said Carl Stanton, a Wellspring partner. "We wish Tube City IMS and their new partners continued success."

"We have found an exceptional and strong management team at Tube City IMS," said Tim Duncanson, an Onex Managing Director. "The company is the largest outsourced provider of these services in North America and the team has positioned Tube City IMS to become the global leader. We're excited to partner with them and work together to achieve this goal."

Michael Coslov, Chief Executive Officer of Tube City IMS, said, "Wellspring was an excellent partner and provided us with the financial and strategic support we needed to establish our market leadership position."

"We are excited to have found in Onex a partner that shares management's vision to grow and expand the business," added Mr. Coslov.

The acquisition is subject to customary conditions and is expected to close early in 2007.

About Wellspring Capital Management

Founded in 1995, Wellspring Capital Management LLC is a New York-based private equity firm with more than $2 billion in equity capital under management. The firm takes controlling positions in promising middle-market companies where it can realize substantial value by contributing innovative operating and financing strategies and capital. Wellspring's limited partners include some of the largest and most respected institutional investors in the United States, Canada, and Europe. Wellspring Capital's current portfolio includes investments in food distribution, for-profit, post-secondary education, golf retail, steel servicing, and other industries. For more information visit Wellspring Capital's website at

About Tube City IMS

Tube City IMS Corporation, based in Pennsylvania, is a leading provider of outsourced services to the global steel industry. Tube City IMS operates at 66 steel mills throughout the U.S., Canada and Europe. With roots stemming back to 1926, the Company offers its customers the broadest array of services in the industry, including materials procurement, supply chain management, melt shop services and finished product handling. For more information, visit:

About Onex

Onex manages third party private equity investments through the Onex Partners and ONCAP family of funds. It also manages a real estate fund and a public market fund. Through these activities Onex generates annual management fee income and earns a carried interest on approximately US$3.5 billion of third party capital.

Onex is a diversified company with annual consolidated revenues of approximately $19 billion and consolidated assets of approximately $15 billion. Onex is one of Canada's largest companies with global operations in service, manufacturing and technology industries. Onex shares trade on the Toronto Stock Exchange under the stock symbol OCX.

Contact Information

  • Contact:

    For Onex Corporation:
    Timothy Duncanson
    (416) 362-7711
    (212) 582-2211

    For Wellspring Capital:
    Steve Lipin or Melissa Daly
    Brunswick Group
    (212) 333-3810